Mahmoud Mohieldin, UN Climate Change High Level Champion for Egypt and UN Special Envoy on Financing 2030 Sustainable Development Agenda, has said that the climate crisis has negative effects on various aspects of life and on all sectors, which underlines the importance of creating a more effective system of protection and risk management. He added that the physical and transitional risks of climate change are increasingly translating into financial risks.
This came during his participation in “Insurance for Adaptation Roundtable” within the events of Bonn Climate Conference, with the participation of Razan Al Mubarak, HLC for COP28, and representatives of governments, and the Insurance Development Forum.
Mohieldin stressed that non-state actors, including private sector financiers, are asked to accelerate action to address the adaptation and resilience financing gap, as UN reports indicated that financing adaptation in middle- and low-income countries is five to ten times below the estimated needs.
He explained that about half of the world’s population is threatened by the effects of climate change, and about 55 middle- and low-income countries have lost more than 20% of their GDP due to climate change.
Mohieldin confirmed the need to treat insurance as an approach to deal with climate change for its ability to reduce risks and protect people, which requires the insurance industry to move towards greater public-private partnerships and provide protection mechanisms within the framework of just transition.
The climate champion explained that climate risk insurance has the potential to reduce the catastrophic impact of climate change phenomena, achieve timely recovery, and contribute to the sustainability of resilience to climate change.
He added that the insurance sector can support climate risk management, contribute to resilience to climate change, create a space of confidence that enhances planning and investing in climate projects, and provide reliable and timely financial relief for livelihood restoration and reconstruction.
Mohieldin said that the HLCs team works on connecting public sector and private financial sector to enhance cooperation between them in order to provide the required funding for adaptation and resilience activities, explaining that the Race to Resilience campaign and a number of climate initiatives, foremost of which is Sharm El Sheikh Adaptation Agenda launched by Egypt presidency of COP27 and HLCs team, depend on insurance sector as a key partner and contributor to achieve adaptation and resilience.
Mohieldin concluded his speech by stressing the need for public and private sectors to cooperate, as well as all actors to build a financing system that helps scaling investments in adaptation and resilience activities.
